On top of that, a European Union politician ! What could she possibly tell you about Swiss banking?

Swiss banking after all means a massive, multinational banking sector accounting for over 6% of the country's annual GDP, employing almost 150,000 people here in Switzerland and 100,000 more abroad.

Well, let me tell you the story of one bank among many.

Credit Suisse was founded 150 years ago by one man from right here in Zurich: Alfred Escher – a politician:

A politician dedicated to making the necessary possible. One contemporary said of Escher "Once he has been seized by an idea, he holds onto it like a bulldog and does not rest until he has brought it into being."

A politician with a clear and realistic goal: open a bank, raise funds and build railways:

Alfred Escher, (and many others like him), laid the groundwork for the Swiss Bankers' Association – founded in 1912 and still going strong a century later:

100 years building up a Swiss services industry which exports 47 billion euros of services to the European Union every year.

100 years boosting Switzerland economically – making it the European Union's fourth biggest trading partner. We, in the European Union, trade more every year with Switzerland than with India, Brazil and South Africa put together.

100 years breaking down borders - allowing ever-greater openness between Switzerland and the rest of Europe. One person in every eight living in Switzerland today is a European Union citizen, whilst the European Union is Switzerland's number one trading partner.

Ladies and Gentlemen,

This EU, your number 1 trading partner, is today at a crossroad. In order to maintain a strong position in a globalised world, it has to choose the path to greater integration.

Two decades ago, we created a monetary union. The Euro, the world’s second most important currency, - a real achievement - makes up 25% of the world’s foreign exchange reserves. 1.5 trillion euros are traded daily on the world’s foreign exchange markets. And it is used daily by the 330 million citizens of the euro area.

A currency that plays a central role in the lives of so many people has to be managed with effective decision-making.

This was missing. Our monetary union did not have a corresponding economic or fiscal union.Insufficient co-ordination between Eurozone members led to macro-economic imbalances. Although the Euro was not at its cause, the crisis exposed cracks in our institutional framework.

These cracks had to be repaired. Most of all because in the age of globalisation, pooling of sovereignty is the only way for European states to be heard on the world stage. Today, this is true for all European states, not just for smaller ones like my home state of Luxembourg but also for the big ones.

Indeed, if nothing is done and the current trends continue, in forty years' time not a single European country will feature in the global top ten economies. The choice is as stark as it is clear: either we swim together, or we sink separately.

We are living in fascinating times. Unprecedented challenges call for bold policy action. But the bolder we are, the more we need solid, principle-based policy analysis and new tools for action.

President Barroso made it clear last September in his State of the Union address when he said – "we cannot face the challenges of the future with the tools of the past".

This is why we are putting in place new tools to strengthen the economic governance of our Union – for example the European Semester to effectively coordinate the budgetary and economic policies of European Union Member States. As we are making the first steps towards a Banking and Fiscal Union, that will not only help us learn the lessons of yesterday, but leave us better prepared to face the challenges of tomorrow.

Let me underline three essential lessons from the crisis:

First lesson: national oversight for transnational banks is not enough.

Only a European approach can curb the risk of future financial and banking crises spilling over from one Member State to another.

Only a European approach can break the "cosy relationship" between banks and national supervisors.

The establishment of a European Banking Union with the European Central Bank as the Single Supervisor is the first step. A European answer to a European problem. It will allow a rigorous and independent supervision of 6,000 Eurozone banks preventing further banking crises spreading to other Eurozone countries – restoring confidence in banks and protecting citizens' savings. The Single Supervisory Mechanism needs to be consolidated with the creation of a common recovery and resolution framework.

Second lesson: we must move from risk to responsibility.

For financial systems this means "Back to Banking Basics".

Reforming the banking sector and putting banks in touch with the everyday concerns of companies and citizens is a matter of urgent necessity. The structures of our financial markets and banking systems have already undergone significant changes since the crisis. In 2008, major banks in the United States, the United Kingdom, Germany, France, Ireland, the Netherlands and Belgium either failed or needed rescue from the state. On the eve of their collapse, every bank boasted at capital levels well in excess of the standards of the time. Those assurances proved to be meaningless because many of the banks were hiding risks off their balance sheets, or those balance sheets were stuffed with supposedly risk-free structured products that turned out to be lethally toxic.

This culture of foolish risk taking needed to change. This has led the European Union to place higher capital and liquidity buffers. The reform of this regulatory environment has meant new rules on the Capital Requirements (CRD/CRR IV), on Credit Rating Agencies, on Alternative Investment Fund Managers, on Markets in Financial Instruments as well as future rules on taxation (such as the financial transaction tax). We also adopted criminal law proposals on insider dealing and market manipulation – banishing Libor-style scandals to the dustbin of history. Let me be clear, the reckless practices of some “banksters” sponsoring a culture of cheating with other people's savings will no longer be able to exploit regulatory loopholes in Europe. Such practices should have no place in the banking industry and those who still do utilise them must bear the cost of their reckless behaviour with the force of criminal law.

To restore trust and have banking firmly grounded on a culture of responsibility we should perhaps follow the example of Alfred Escher, who used his young bank to fund many small projects – fuelling the Swiss economy in the process.

In short,

We need banks to lend to small and medium sized businesses. (In the EU these represent 85% of industrial setup)

We need banks to finance the real economy.

Complementing these efforts we notice the brave steps taken by several banks to distance themselves from more "risk-based" activities3.

More will be on the way with the implementation of the Liikanen report on reforming the structure of the EU banking sector. Liikanen proposes to separate certain particularly risky financial activities from deposit-taking banks. The goal should be to make the most relevant parts of banking (taking deposits from customers and invest in the real economy) safer and less connected to high-risk trading activities. And – most of all - to break the stake of taxpayer in the trading parts of banking groups.

Third lesson: Responsibility applies not just to banks, but also to national governments.

The sovereign debt crisis made the consequences of uncoordinated action clear for all to see.

In our increasingly interconnected world, the economic decisions made by one national government have a direct impact on all others. National policies have international implications.

To tackle this, Member States decided upon a Fiscal Compact, establishing stronger economic policy co-ordination between Eurozone governments. It will grant the European Commission greater powers to review national draft budgets so that debt and deficit levels remain sensible, sustainable and responsible. By the way, a far reaching intervention into national prerogatives. But a necessary one in order to preserve common interests.

The European Commission will soon publish a “blueprint” for deepening Economic and Monetary Union – presenting the tools to move from words into reality. To that end our Member States will have to pool more sovereignty in order to ensure a stable and prosperous monetary union.

Our vision for the Economic Monetary Union has four pillars – fiscal union, financial union, economic union and political union. Progress on all four should be made simultaneously. The first three pillars will help to steer fiscal, financial and economic policies in a sustainable way. They will also help to create institutions commensurate with the degree of monetary integration in the euro area. And the political union is essential for engaging euro area citizens more deeply and for legitimising the other three pillars.

2. Economic - Single Market

So that is the institutional framework for the Europe of tomorrow.

But what Europe needs today is growth.

This brings me to my second point – realising the full potential of our Single Market.

The Single Market is the jewel in our crown – bringing together 500 million citizens and 23 million businesses to act as an engine for economic growth. Completing our Single Market remains a real challenge for the years to come.

Here are some examples:

We must connect Europe's rail networks.

The Swiss have always set the standard in this regard.

Over a hundred years ago, Alfred Escher backed the first ever tunnel through the Gotthard Massif. At the time, the tunnel was hailed as Europe's answer to the Suez Canal – an unrivalled example of engineering prowess. Escher's statue still welcomes travellers to Zurich's station in tribute.

Today, Swiss engineers are breaking new ground at the Gotthard Massif. Once open in 2016, the Gotthard Base Tunnel will span 57km, making it the longest tunnel in the world.

The European Union is also continuing Escher's legacy, through the Connecting Europe Facility, investing almost 32 billion euros to revolutionise Europe's cross-border transport infrastructure. This will not only create jobs all over Europe, but also boost cross-border travel and business.

Another example: remove legal obstacles to cross-border trade.

An efficient civil and commercial justice system is at the heart of any market economy. Indeed, justice equals confidence and confidence equals growth. In other words, we need justice for growth.

The proof? Almost four out of every ten businesses would be more inclined to trade abroad if court procedures for settling cross-border disputes were simplified.

For this reason, in 2010 I proposed abolishing the costly 'exequatur' procedure requiring today a lengthy process to get a judgement issued in one Member State recognised in another. In practice this will mean full faith and credit in the enforcement of judgments Europe-wide. I have also proposed an optional European Sales Law to significantly reduce the legal costs for businesses expanding into another Member State. The aim is simply: instead of 27 rules there will be one single European Sales Law for the whole European Market.

The proposed reform of data-protection rules follows the same pattern: one single rule for the whole market. Expected savings for companies: 2.3 billion euros per year.

Estimated GDP growth by 2020: 4%. Taking the necessary steps to create a modern digital single market is the key to the future development of our economy, preserving at the same time the right to personal data of the individual, a principle inscribed in the European Treaties and in the Charter of Fundamental Rights.

Under our plans, one single national data protection authority would be responsible for a company operating in several EU Member States. This "one-stop-shop" approach would save companies well over two billion euros every year and maximise their potential across the Single European Market.

3. Political – Political Union

Yet institutional and economic integration – necessary as they may be – are not sufficient.

As politicians we can only make the necessary possible with the support of our fellow citizens.

And this brings me to mythird andfinal point. We must move towards a Political Union in Europe. Not as an afterthought an add-on or an optional extra. But as the core of our actions and the finality of our endeavour. A political union with a strong participation of citizens and a day-per-day control by the directly elected European Parliament. This will bring back the lost trust. As you certainly know, trust in politicians, as in bankers, is dramatically low. But neither we politicians nor you bankers can build the future without the trust and confidence of citizens or clients. Let's call it "reputation rehabilitation". Or like the German private banker, Friedrich von Metzler, said "You can lose money from time to time. But you never must lose your reputation." So, let's put values again at the core of our thinking and behaviour. For Europe, these are the basis of the "community of values" which are at the foundations of our European Union – freedom, democracy, peace and the rule of law, the respect of the individual and responsibility towards society.

These are values that have linked Europe and Switzerland for centuries. Values which embody who we are, what we want to be. With the award of the Nobel Peace Prize, the necessity of preserving those values has been especially underlined. We all know that.

Conclusion

Today's crisis is mainly a "crisis of confidence" – a political problem. And as President Barroso reminded us "there is no political problem for which we cannot find a political solution."

Of course, politicians will play a key role in this solution-finding. But the truth is we cannot do it alone.

Let us go back to Alfred Escher.

He may have been a politician, but would Credit Suisse, would your Association, would Switzerland be what they are today if he had not had bankers, academics, supervisors and countless other groups by his side? I doubt it.

Similarly, the vision that I have outlined today – institutional, economic, political – will remain mere words on a page unless Europeans – whatever their background – will help turn it into reality. And maybe (let's hope) one day even Switzerland will join this project.